Ryanair reports record €2.26bn profit but Iran uncertainty stalls growth

Ryanair chief executive Michael O'Leary. The airline reported an after-tax profit of €2.26bn for the year that ended in March,

Ryanair on Monday warned that consumer anxiety surrounding the US-Israeli war on Iran is likely to wipe out any growth in fares in the peak summer months, but the threat of fuel shortages is receding as suppliers adapt to the closure of the Strait of Hormuz.

The comments came as Europe's largest airline by passenger numbers reported a record profit for the fiscal year that ended in March, slightly ahead of analyst expectations.

On Monday, it reported an after-tax profit of €2.26bn for the year that ended in March, compared with a forecast of €2.20bn in a company poll of analysts. That did not include an exceptional €85m provision related to a fine from the Italian competition authority in December that it said it expects will be overturned on appeal.

"We've delivered a record year, record traffic, record profits," chief executive Michael O'Leary said. "Clearly at the moment we are going through significant uncertainty."

Ryanair last week said it does not expect a disruption to jet fuel supplies in Europe this summer but that its profit may come under "a bit of pressure" if oil prices remain high for longer.

The low-cost carrier had been expecting low-single-digit percentage increases in fares during the peak summer months, but pricing "is now trending broadly flat" in the July-to-September period thanks to inflation fears and consumer concerns about fuel shortages, it said in a statement.

Visibility on fares is poor, however, and the summer's profitability will depend heavily on last-minute bookings, Ryanair said.

Chief financial officer Neil Sorahan said the airline’s fuel bill has risen by “a few hundred million” euro but was "increasingly confident" that there will be no disruption to jet fuel supplies even after the summer as suppliers increase their volumes and seek alternatives to Gulf oil supplies,

Pricing for the July-to-September quarter, which had earlier been expected to post annual gains in low-single-digit percentage terms, "is now trending broadly flat," the statement said.

"With zero H2 visibility and significant fuel price/potential supply volatility it is far too early to provide any meaningful FY27 profit guidance at this time," a statement said.

Reuters